in the Clinton Administration

Keynote Address

International Biotechnology Expo and Conference

Tuesday, October 26, 1993

The 20th century, especially since World War II, is truly the age of scienceand technology, of discovery and transformation. From outer space, with thebig bang and black holes, to inner space, wi th quarks, superconductivity,neuroscience, and molecular biology, we've stretched our minds, pushed out ourhorizons, provided countless new options, and there's no end in sight. I wouldposit that the the most vital of all the new knowledge is that whi ch sustainsyour industry -- the processes of life -- from ecosystems to organisms to cellsto molecules. That new knowledge, especially at the cellular and molecularlevels , is extremely powerful and ubiquitous and has influencedpharmauceuticals; agri cultural products, from biopesticides to food withimproved nutritional and other qualities, bioremediation, law enforcement, andmore.

Two very recent examples come to mind, both the result of public-privatecooperation in research and developmen t.

1. In Virginia, authorities used a DNA databank to help identify and make anarrest in a rape case where police had no suspects until the DNA match wasmade.

2. Researchers have isolated genes that enable a certain bacteria to float on water. The next step is to transfer the genes to bacteria that eat oil ... butsink.

In case after case we are not only revolutionizing science and technology, butalso traditional thinking in our societies about how things ought to be and howto govern in our high-tech society. The new biology and biotechnology, likenuclear energy and almost all very powerful discoveries, seem to promise,simultaneously," the promises of heaven and the perils of hell."

What is the Federal Role?

We all play different roles in a revolution, and I would like to explore withyou today the appropriate Federal role in the biotechnology revolution.Basically I believe we have two responsibilties:

1. Support foundational, or basic, resear ch and cooperative R&D with theprivate sector in areas of generic technology development. In other words,provide a good seed bed; and

2. Provide thoughtful and sensible governance, including regulatory, fiscal,and trade policies that encourage innovation and commercialization.

Before pursuing these thoughts, let me describe the broad approach being takenby the Clinton Administration to help restore economic vitality and set thebasis for a competitive and sustainable future.< p>

1. We are, with respect to the deficit, adhering to the first rule of holes:when you're in one, stop digging. We have to stop running up a debt for whichour children and grandchildren will bear responsibility. But that doesn't meanwe stop inv esting in the future.

2. We are reinventing government, investing in technologies, and adjustingpolicies to make government efficient and responsive.

3. We are investing in science and technology -- the engines of economicgrowth.

Techn ology Initiatives

The Clinton Administration has committed to move our Nation in a directionthat explicitly recognizes the critical role technology must play instimulating and sustaining the long-term economic growth that createshigh-qualit y jobs and protects our environment. The traditional, hot- andcold-war dominated federal role in technology development has been limited tosupport of basic science and federal mission-oriented research. This strategymay have been appropriate for a pre vious generation, but not for today'sprofound challenges. In short, we cannot rely on the serendipitous applicationof defense technology to fuel technology innovations in the private sector.

The Clinton Administration's technology initiatives encompass many efforts towork directly with entrepreneurs and industries that are improving existing ordeveloping new technologies. This represents a critical change of course forthe United States. Compared to Japan and our other competitors, govern mentsupport for civilian technology development has been minimal in the UnitedStates. Federal investments have focused on basic research and the developmentof technologies related to defense and space exploration, which have onlyindirectly led to new opportunities for the civilian sector. That is no longersufficient; in fact, the reverse is now true. And in many high-tech fields,foreign companies have either matched or surpassed the best Americancompanies.

Happily, such is not the case i n biotechnology, and our intent is for our newinitiatives to sustain your industry's history of success. Our technologyinitiatives encompass a range of cooperative, fiscal, and regulatory policiesnecessary to a positive business climate. Let me enume rate some for you:

1) Increased funding to support research and development of civiliantechnologies by shifting (over the next four years) the current 60:40 ratio ofdefense to civilian spending at least 50% for civilian.

2) Instructions to Federal laboratories to devote a growing percentage of theirbudgets to R&D partnerships with civilian industry. We are emphasizingincreased use of cooperative, cost-shared research and development agreements(CRADAs)as well as other cooperative ar rangements.

One of the first CRADAs initiated by the National Institutes of Health isnoteworthy in several respects. The CRADA between NIH and Genetic Therapy Inc.(GTI) capitalized on technology and expertise in the NIH laboratories of Drs.Fre nch Anderson, Michael Blaese and Steven Rosenberg, to launch a new company,a new form of treatment for genetic and other diseases and a new industrysector, that is, gene therapy. Beginning with the first human gene transfertrial initiated in 1988, NIH has now approved over 50 clinical gene therapytrials at centers across the nation. Studies involving revolutionaryapproaches to the treatment of cystic fibrosis, severe combined immunedeficiency, advanced melanoma and AIDS are now underway or are abo ut to beundertaken. These represent tremendous health care and economic achievementsfor this country.

I understand you may have some concerns regarding the pricing clause in NIHCRADA's and licenses. This is an issue under examination in theA dministration, and I would be interested in having your views.

3) Dramatic expansion of the Commerce Department's Advanced Technology Program.Established by Congress in 1988 and first funded in 1990, the ATP shares thecosts with industry of R& ;D projects that are defined and led by industryand are selected through merit-based competition. ATP is funded at $68 millionthis year. President Clinton has set a goal of raising that amount tenfold by1997. This increasing support for the Commerce Department's industrialpartnerships is an essential feature of the thrust to a more civilian-orientedFederal technology policy.

4) A new multi-agency program established at EPA to fund development anddiffusion of new environmental techno logies. The worldwide market forenvironmental technology is projected to grow from $200 billion today to atleast $300 billion by the year 2000. We want to help American businessescapture as much of this market as possible. I have also created a new subcommittee of the Federal Coordinating Council on Science, Engineering, andTechnology (FCCSET) to look at environmental technologies, primarily those"dark green" technologies developed to solve particular problems. This newsubcommittee will help OS TP and the research agencies formulate budgetpriorities.

5) Expansion of the Small Business Innovation Research (SBIR) Program.The SBIR program has been a real success, helping hundreds of small companiesthroughout the country take good